Clost et al. v. Colautti Construction Ltd. et al.

52 O.R. (2d) 339

 ONTARIO

 HIGH COURT OF JUSTICE

OSBORNE J.

4TH NOVEMBER 1985.

Limitations -- Motor vehicles -- Damages occasioned by motor vehicle -- Child playing with toy when struck by motor vehicle -- Toy manufacturer joined as defendant -- Toy manufacturer not entitled to rely on two-year limitation period applicable where damages occasioned by motor vehicle -- Highway Traffic Act, R.S.O. 1980, c. 198, s. 180(1).

The infant plaintiff was struck by a motor vehicle and injured, having ridden his toy truck into a street. More than two years after the accident, the manufacturer of the toy truck was added as a defendant. The applicant moved pursuant to rule 21.01 for an order determining whether the two-year limitation period contained in the Highway Traffic Act, R.S.O. 1980, c. 198, regarding actions brought for the recovery of damages occasioned by a motor vehicle was applicable to it.

Held, the motion should be dismissed. In determining the applicability of the special limitation period provided for by s. 180(1) of the Highway Traffic Act, it is necessary to focus the claim being made against the defendant seeking the protection of the limitation period. It is not simply a matter of asking whether the plaintiff was struck and injured by a motor vehicle. With regard to this defendant, the plaintiff 's claim was one of products liability or negligence, and the fact that this alleged negligence resulted in a car-pedestrian accident was incidental to the substance of the claim. Accordingly, this defendant was not entitled to claim the protection of the two-year limitation period.

Hydro-Electric Power Com'n of Ontario v. Bruell Float Service Ltd. (1974), 3 O.R. (2d) 108, 44 D.L.R. (3d) 524; affd [1976] 1 S.C.R. 9, 55 D.L.R. (2d) 236, sub nom. Bruell Float Service Ltd. v. Ontario Hydro, 3 N.R. 508; F. W. Argue Ltd. et al. v. Howe, [1969] S.C.R. 354, 3 D.L.R. (3d) 290, apld

Other cases referred to

Lebed et al. v. Chrysler Canada Ltd. et al. (1979), 25 O.R. (2d) 161, 100 D.L.R. (3d) 553; Dufferin Paving & Crushed Stone, Ltd. v. Anger & Derbyshire, [1940] S.C.R. 174, [1940] 1 D.L.R. 1; Heppel v. Stewart et al., [1968] S.C.R. 707, 69 D.L.R. (2d) 88; Byrne v. Goodyear Canada Inc. (1981), 33 O.R. (2d) 800, 125 D.L.R. (3d) 695; Fraser v. Peckham et al. (1983), 42 O.R. (2d) 354, 148 D.L.R. (3d) 650, 22 M.V.R. 172

Statutes referred to

Highway Traffic Act, R.S.O. 1980, c. 198, s. 180(1)

Rules and regulations referred to

Rules of Civil Procedure, rule 21.01

MOTION by one of several defendants for the determination of the applicability of a limitation period.

Brian Parnega, for plaintiff, K. Clost.

L. Jane Rutherford, for defendant, Colautti Construction Limited.

James R. McIninch, for defendant, G. Clost.

Robert Nelson and Terry D. McEwan, for defendant, Plastic Toy and Novelty Corporation.

OSBORNE J.:-- This is an application under rule 21.01 by the defendant Plastic Toy and Novelty Corporation (Novelty) in which the central issue is whether the two-year Highway Traffic Act limitation period applies in an action against the manufacturer of a toy on which the infant plaintiff was playing when he was struck by a car. It is common ground that the two-year limitation period applies in the plaintiffs' action against the owner and driver of the motor vehicle directly causing the infant's injuries.

On July 6, 1982, the infant plaintiff was playing on a toy truck manufactured by the applicant Novelty, when somehow the infant plaintiff rode his toy on to Moodie Dr. in the City of Nepean where he was hit by a motor vehicle owned by the defendant Colautti Construction Limited and driven by the defendant Scorgie. The statement of claim suggests that the infant plaintiff suffered severe injuries. The pecuniary and non-pecuniary general damage claims total eight million dollars.

All defendants but Novelty were sued within two years of the accident. Novelty was added as a defendant on March 19, 1985, by order of the local master.

Section 180(1) of the Highway Traffic Act, R.S.O. 1980, c. 198, provides:

180(1) Subject to subsections (2) and (3), no action shall be brought against a person for the recovery of damages occasioned by a motor vehicle after the expiration of two years from the time the damages were sustained.

Novelty's position is that it is entitled to the protection of s. 180(1) of the Highway Traffic Act because the plaintiff 's injuries were "occasioned by a motor vehicle" in that the plaintiff 's injuries were the result of an impact between the infant plaintiff and the Colautti motor vehicle. Paragraph 14 of the applicant's factum puts it this way:

14. The cause in fact of the infant Plaintiff 's damages, as alleged in the Statement of Claim, was the occasion on which the said infant collided with a motor vehicle and was thrown violently to the ground. In this action for recovery of such damages the said infant alleges that the Defendant Plastic Toy and Novelty Corporation negligently manufactured, designed, and distributed the toy on which he was riding at the time of the collision aforesaid. There is no allegation of a contract or breach of contract as between these two parties. On these facts s. 180(1) of the Highway Traffic Act applies to bar this action commenced after the expiration of two years from the time the damages were sustained.

All respondents, including the infant plaintiff 's mother who is alleged to have negligently supervised her son, take the position that s. 180(1) is not a bar to the plaintiff 's claim.

All claims are based on negligence. There is no existing, or pleaded, contractual relationship between the plaintiffs and any of the defendants, including Novelty. This was emphasized by Mr. Nelson in his submissions for the applicant. Because of the absence of any claim in contract, Mr. Nelson contends that cases like Hydro-Electric Power Com'n of Ontario v. Bruell Float Service Ltd. (1974), 3 O.R. (2d) 108, 44 D.L.R. (3d) 524 (Ont. C.A.); affirmed [1976] 1 S.C.R. 9, 55 D.L.R. (2d) 236, sub nom. Bruell Float Service Ltd. v. Ontario Hydro, 3 N.R. 508, cannot support the conclusion that the two-year Highway Traffic Act limitation period does not apply to all defendants, including Novelty.

It has been recognized for some time that there is some confusion as to the ambit of what is now s. 180(1) of the Highway Traffic Act. This is because of somewhat conflicting decisions of the Supreme Court of Canada in which the Highway Traffic Act limitation period has been considered. This conflict was referred to by Cory J., as he then was, in Lebed et al. v. Chrysler Canada Ltd. et al. (1979), 25 O.R. (2d) 161, 100 D.L.R. (3d) 553.

In the period extending from 1940 to 1976 the Supreme Court of Canada considered the Highway Traffic Act limitation period on four occasions. In Dufferin Paving & Crushed Stone, Ltd. v. Anger & Derbyshire, [1940] S.C.R. 174, [1940] 1 D.L.R. 1, it was held that the Highway Traffic Act limitation period applied to nuisance actions, and specifically that it applied to bar a claim where the damages complained of by the plaintiff were occasioned by vibrations coming from a cement mixer affixed to a cement truck.

In Heppel v. Stewart et al., [1968] S.C.R. 707, 69 D.L.R. (2d) 88, Martland J., for the majority, concluded that the Highway Traffic Act limitation period was not ambiguous, and that it barred a claim in which the plaintiff contended that the proposed defendant, a service station operator, was liable for a rear-end collision because the proposed defendant had negligently examined or repaired the brakes on the defendant's car. Martland J. reduced the dimensions of the issue in saying at p. 709 that: "The only question in issue is whether the plaintiff 's damages were 'occasioned by a motor vehicle'. "

In Heppel the judge of first instance had held that the limitation period applied if the damages claimed were caused by a motor vehicle. The damages claimed in the Heppel case were caused by a motor vehicle because it was a motor vehicle (allegedly one with no brakes) which hit the rear of the plaintiff 's motor vehicle. The Court of Appeal allowed the appeal, concluding that the Highway Traffic Act limitation period only applied if the legal basis of the claim was the use and operation of a motor vehicle. Martland J. held that the section applied if a motor vehicle "is the occasion for the damage". At p. 710 Martland J. said: "If a motor vehicle is the occasion for the damage, i.e., if it is the vehicle which brings it about, then the limitation period applies."

Judson J. dissented, concluding, as did the Court of Appeal for Ontario, that the damages claimed were not caused by the use or operation of the motor vehicle, but by the antecedent negligence of a repairman who was neither the owner nor operator of any motor vehicle involved.

In 1968 the limitation period issue came before the Supreme Court of Canada once again in F. W. Argue Ltd. et al. v. Howe, [1969] S.C.R. 354, 3 D.L.R. (3d) 290. In Argue the damage claimed was alleged to have been caused by the negligence of a defendant who had delivered oil to the plaintiff 's premises from a tank truck on which a pump and connecting hose were mounted. The truck's motor operated the pump, but only when the truck was stopped. The filling operation at the plaintiff 's premises resulted in the plaintiff 's basement being filled with oil. This, in turn, resulted in a fire. The trial judge, Landreville J., found negligence, but held that the plaintiff 's claims were barred because a writ was not issued within the prevailing Highway Traffic Act limitation period. The Court of Appeal allowed the appeal. Spence J., for a unanimous Supreme Court of Canada, held the limitation period did not apply unless the damage claimed was occasioned by a motor vehicle "used as a motor vehicle". Spence J. concluded, as Laskin J.A. (as he then was) had in the Court of Appeal, that this result was not incompatible with the Supreme Court of Canada's decision in Dufferin Paving. Spence J. considered the impact of the Heppel case, but found it did not apply because the damages claimed in Argue were not damages occasioned by a motor vehicle, as was the case in Heppel.

In 1975 the Supreme Court of Canada once again considered the Highway Traffic Act limitation period. In Bruell, supra, Judson J. (who dissented in Heppel) gave the Supreme Court of Canada's unanimous judgment. In Bruell the defendant had contracted as a common carrier to transport the plaintiff 's machinery from point A to point B. A truck was used as the means of transportation. The truck drove under a low bridge and the plaintiff 's machinery was damaged. The writ was issued outside the prevailing Highway Traffic Act limitation period. The trial judge dismissed the action on the limitation period issue. The Court of Appeal allowed the appeal. The defendant appealed to the Supreme Court of Canada. At pp. 11-2 Judson J. said:

The Court of Appeal, in the present case, unanimously held that it would take the clearest possible language on the part of the Legislature to impose a limitation provision affecting actions in contract by reason only of the fact that a vehicle might be somehow involved in the performance of the contract. I agree with this conclusion. I note that it had been anticipated, in full, in Northern Alberta Dairy Pool Ltd. v. Strong & Sons Ltd. (1960), 27 D.L.R. (2d) 174, also a common carrier case.

I also agree with their conclusion that it is unnecessary in the determination of this appeal to reconcile the Heppel v. Stewart and the F. W. Argue, Ltd. v. Howe pronouncements because the facts before us do not involve a situation where the damage was occasioned by a vehicle not being used as a vehicle (as in the Argue case) nor a related negligence claim in circumstances arising out of a collision between motor vehicles (as in Heppel v. Stewart).

Judson J. seems to have accepted the reasoning of the Ontario Court of Appeal. In the Court of Appeal, Estey J.A. (as he then was) noted that the dictum of Martland J. in Heppel was not essential to his judgment while Spence J.'s observations in Argue as to the meaning of the Highway Traffic Act limitation period were essential to his judgment. Estey J.A., therefore, preferred to follow the approach taken by Spence J. in Argue. In the end result, the Supreme Court of Canada concluded that the Highway Traffic Act limitation period did not apply to actions founded in contract.

Subsequent cases like Lebed, supra (brake failure), Byrne v. Goodyear Canada Inc. (1981), 33 O.R. (2d) 800, 125 D.L.R. (3d) 695 (tire failure), have followed Heppel in applying the Highway Traffic Act limitation period to any claim based on negligence, where the damages claimed were occasioned by a motor vehicle, and Bruell in not applying the Highway Traffic Act limitation period, if the claim was based in contract. In all of those cases the damages claimed were occasioned by a motor vehicle in the physical sense. Henry J. in Fraser v. Peckham et al. (1983), 42 O.R. (2d) 354, 148 D.L.R. (3d) 650, 22 M.V.R. 172, took it somewhat further in holding that the plaintiff 's claim was statute-barred, even if the plaintiff had a claim in contract. At p. 359, Henry J. said:

In my opinion there can be no question that the circumstances of this case brings it within s. 180(1); the plaintiff 's injuries were occasioned by a motor vehicle, within the meaning of that provision. The words are clear in this context. To hold otherwise would mean that the action based on the same circumstances if framed in negligence, would be barred by the limitation provision, but if framed in contract, would not be so barred.

Henry J. did not consider that in Bruell the plaintiff had a claim in both contract and negligence, and had asserted both claims in the action against the common carrier.

In my view, the observations of Estey J.A. in Bruell, supra, as to the impact of Martland J.'s judgment in Heppel are apt. What filters through the Supreme Court of Canada's decisions in Argue and Bruell is the need to examine the substance of the claim being advanced, as opposed to simply considering what actually caused the damage complained of. Mr. Nelson contends that the obvious basis of the plaintiff 's claim is that the plaintiff was struck and injured by a car and that the claim advanced against all defendants, including the applicant toy manufacturer, are in tort. There is no doubt about the factual integrity of that submission. In my view, the intellectual exercise required must focus on the claim being made against the defendant seeking the protection of the Highway Traffic Act limitation period. What claim is being made against that defendant? That is a far different exercise than asking the simplistic question, how was this plaintiff injured? or, did a motor vehicle occasion the physical injury referred to as the basis for the plaintiff 's damage claims?

The plaintiff 's action against Novelty is based on negligence in the design, manufacture and distribution of the toy on which the infant plaintiff is alleged to have been riding at the time of the accident. This is a products liability-negligence claim. In Bruell the Supreme Court of Canada concluded that the limitation period did not apply to actions in contract. This has been referred to as an exception to the limitation periods application: see Byrne v. Goodyear, supra. I do not view the non-applicability of s. 180(1) to contract actions as an exception. Either the limitation period applies by its own terms, or it does not. The rationale behind the conclusion that s. 180(1) does not apply to contract actions seems to me to be that in those actions the damages claimed were occasioned by a breach of contract, and that it is only incidental that a motor vehicle accident was also involved.

Here the claim of the plaintiff is that the manufacturer's negligence is what caused or occasioned the damages claimed. The fact that the manufacturer's negligence alleged resulted in a car-pedestrian accident is, in my view, incidental to the essence or substance of the claim advanced against the applicant defendant. In my opinion, the Highway Traffic Act limitation period has no application to the applicant. The Highway Traffic Act in general, and s. 180(1) in particular, were never intended to apply to products liability claims where the product involved is not a motor vehicle or an integral part of a motor vehicle such as a tire, brakes, door, etc.

The application must be dismissed. All respondents are entitled to costs.

Motion dismissed.